Dealer Invoice Prices

Car dealers buy wholesale and sell retail, the way most retail businesses works. They buy cars from the car manufacturer (all car dealers are independent businesses, not owned by a manufacturer) for a specific price (invoice price) and mark up that price when selling to customers. It's the same way that JC Penney, Walmart, and Amazon.com work.

However, there seems to be a certain mystique about automobile invoice prices that isn't there when dealing with other kinds of businesses.

It stems from the fact that dealers often advertise "will sell at invoice" or "below invoice prices" and have brought the attention on themselves. Automotive customers are more aware of the fact that car dealers sell at different prices to different customers, and that it is actually possible to buy a car at or below wholesale price (because dealers say so). Customers want the best deal possible, and expect to get the same kind of deal that other customers are getting.

What is invoice price?

Invoice price is the price a car dealer pays to the manufacturer for each vehicle he buys. The price is the same for every dealer across the U.S.. There are other costs as well. Destination cost is also charged. This is a transportation and delivery fee that is also the same for every dealer, even if the dealer is next door to the manufacturing plant. Dealers simply pass this fee along to customers without markup.

Home equity loans and home line of credit loans are often a good way to finance the purchase of a car. Refinancing your mortgage is another option. However, understand the benefits and the risks before making a decision.